PS Vita System Update 1.60 Full Change Log

An update to the PlayStation Vita system software was released on February 8th, 2012. You can use this to update your system software to version 1.60.

A PS Vita system software update is required to use PlayStation Network features and some features on the system. Also, downloading and installing the PS Vita system software update will update your PS Vita system’s operating system to include the latest security patches, as well as new and revised applications, features, and settings. It is recommended that you always maintain your system to use the latest version of the system software.

I would say it was more predominantly third parties abandoning it. Which is part of the reason why you didn't see big titles re-releasing on the PSN store when PSP games first debuted on it. Crisis Core and Kingdom Hearts is a prime example.

They need to fix the web browser.. it's too slow on displaying content while scrolling up & down on a web page.

They also need to enable Adobe Flash.. the functionality is there, it just hasn't been enabled for some unknown reason.. and of course, The YouTube app.. All PS Vita owners want it.. so make it happen.